and yellen speaking. they're not going to surprise in two weeks. they're going to telegraph it. friday is an opportunity for them to do so. >> krogers. big buy. >> atk, defense is moving. it will keep going. >> good stuff. thanks. that does it for us. "power" starts right now. welcome to "power lunch." i'm michelle caruso-cabrera. march roaring in like a lion, stocks having the best day of the year, 300-point rally on the dow, pushing it above the 21,000 mark for the first time ever, by the way. 20 trading sessions since the dow crossed 20,000. records across the board. trump rally alive and well. we are all over this unprecedented run straight ahead here on "power lunch." >> i'm melissa lee. check out the big movers as the bulls charge ahead today.

financials hitting its high of nine years, bank of mek, citi, goldman, morgan stanley. up a full percentage point qqq. and this rally is reaching all corners of the market with more than a fifth of the entire s&p 500 hitting new 52-week highs. brian? >> melissa, thank you very much. i'm brian sullivan down in washington, d.c. what a day to be here. the good feeling after the speech certainly has investors feeling good. but speech aside, is the gop more likely to really get what they want? what are the democrats likely to give up to help the gop get to their goals? all that stuff from here. great guests lined up from the russell senate building rotunda here in washington, d.c. i'll send it back to michelle. >> actually, i'll pick it up from there. >> tyler. >> welcome, everybody, i'm tyler mathisen. what a day we are witnessing.

record move for stocks, president's comments before a joint session of congress, kicking the trump rally into high gear. and i thought it was just because i'm back after two days off in a row. let's get back to bob pisani. >> hello, tyler. big, big cut in taxes and massive tax relief for the american middle class. spurring hope for more savings and, of course, more investments, potentially, down the road. asset managers, blackrock, piper jaffray are all up. he also talked about putting a deregulation task force inside every agency. and, of course, that is going to help cut into regulations for every one that is there. banks would be among the biggest beneficiaries. goldman sachs, bank of america, jp morgan and regions financial. the president reiterated his desire to spend $1 trillion on infrastructure, financed through a public/private partnership. no timeframe here. it was a campaign promise. also, his intent to begin construction of the great wall

along our southern border. as a result, take a look. infrastructure stocks like aecom are getting a boost today. the president talked about repealing and replacing obamacare but specifically giving states flexibility on medicaid. medicaid is jointly financed by the federal government and by states. federal government provides matching dollars to states for allowable spending on medicaid on an open-ended basis. medicaid managed companies are all on the upside. trump didn't offer a lot more specifics but the forcefulness of the speech implied he could accomplish his goals of lower taxes, infrastructure and regulatory reform and that is why the markets are rallying. back to you. >> bob pisani, thank you. let's get more on the president's comments that are sending stocks soaring today. kayla tausche is on the white

house lawn. kayla? >> reporter: the president and his top advisers are meeting with gop leaders, talking about what was said in the speech last night, the priorities, the to-do list that the president set for congress and also about the process that is going to be getting under way. take a quick listen to the president's remarks. >> thank you very much. we're here to start the process and we think we'll have tremendous success. thank you very much. >> reporter: that process, of course, will be -- that process, of course, will be a very involved one because of the very long agenda that the president has set for congress. health care reform, though, being the very first thing they will be focused on. i'm told by an aid that the topic of the weekly republican conference meeting that happens tomorrow morning will be on health care reform and how to put the nuts and bolts that the president acknowledged last night like tax credits for americans to buy their insurance, potential access for

people with pre-existing conditions and also the ability of insurance companies and consumers to buy and sell this insurance across state lines. there's a lot of meat to put on the bones where policy is concerned. i want to tell you what sean spicer told our colleague, eamon javer javersay while ago. he was asked what dow 20,000 means for the optimism in the economy and secretary spicer said he didn't want to tie it directly to the president. he didn't want to tie a direct link, unlike what the president and secretary mnuchin had said in the last week but says it does give the sensor reflect the renewed optimism by business, economists and by just people on the ground, confidence in the country and the agenda and the propensity to hire. guys? >> wonder if he will hear back from the president on that one. thank you, kayla. let's talk more about this record run. chief investment officer and

bianco research. sean spicer doesn't want to tie it directly to president trump but do you, today's rally? did you see anything last night that suggests we should be up 300 points? >> i think the main thing we saw, the president acted presidential. the speech was conciliatory. it looked like the one he gave the night of the election, which also saw markets rise sharply. when he's in and out having twitter wars, the markets like a lot of what he's saying. one concern is that stocks might be getting a little bit ahead of themselves, acting as though the market can get trump a la cart. they like tax cuts, infrastructure spending but we're going to take a pass on the protectionism. that's the one part they're skipping. they're not pricing in that you get the whole package. >> jim bianco, what's amazing about today, fed rate hike expectations have gone way up.

70% chance of a hike in march markets are saying, and everybody seems to be applauding that. >> yeah, that is an unusual circumstance. the last literally quarter of a century, you could be mistaken for nostrasm damus following what the market thinks as far as what the fed is going to do, figuring it out weeks in advance. we haven't seen anything like this in quite a long time. you're right that the stock market and rest of the markets -- maybe the bond market isn't but the stock market isn't being bothered by this at all. there's a 70% chance that the fed is going to raise rates. maybe januariette yellen changes that on friday but right now you have to expect a rate hike. all things being equal, that's not good for the market. but it has been ignoring everything and wants to go up every day. >> is it over for bonds? the flip and the fed funds future was so dramatic and the

positioning in the bond market so interesting. data a couple of weeks ago showing the largest net short position in a very long time, if not all-time highs. here we are with a big sell-off in the bond market. >> even with today's big sell-off in the bond market, had you been an owner of the ten-year, 30-year bond or ts, you were still up on the year. you're not losing money in the bond market right now partially because of what you mentioned with the positioning. everybody is bearish on the bond market. everybody is short on the bond market. i'm speaking in absolutes but it's not that far from the truth. that's one reason yields have not gone up all year. i think we'll have to work this short off. but once that's worked off, to your question, is it over with in the bond market? maybe toward the end of the year, into 2018, it might be. but for right now, i think into the summer, you're probably going to see lower yields because everybody is positioned for higher yields.

and that's one of the reasons why i think we'll continue to get the short cover we've had. >> so, burns, do you think that rates will go up as the market seems to be expecting? number two, will it affect stocks at all? >> it won't go up too much -- >> too much but a quarter point. >> priced in to with one, two, probably three rate hike this is year. for that reason we would still be wary of the bond proxies. some of the places that could still stand to benefit would be some of the more gdp seps active areas of the market. >> you said it's priced for perfection. what could pull some of that perfection out? if it's not interest rates rising, what is it? >> i think that, again, the -- >> europe? >> you have a lot of the fed -- appointments that mr. trump has talked about have been very hawkish appointees. that's one of the factors. one of the other big things you're starting to see a pickup

in wages. you have the stocks trading 18, 19 times earnings but corporate profit margins are well above their averages. you normalize those profit margins and you're looking at stocks trading north of 20 times earnings. >> in terms of what can derail -- i'm going to much simpler, bank of america note, raising their year-end price target to 24.50. once we get more details from right now we're l etch vitating because we're getting just enough detail. the a la carte, sort of pick your own adventure menu here. wops we start seeing what is being given up in order to get that tax cut or repeal of obamacare, markets may not like that as much. >> i agree with that. i think we're getting a trump reflation. what are we reflating?

real dproeth in earnings? that's what the market thinks now. or are we going to reflate inflation? the market might switch over and start to worry that we're going to get that inflation. rates going up in and of themselves is not a negative for the stock market. it could be real gdp is coming through. if it starts going up because it starts to worry that inflation is returning, i think that could be a game changer. that may be what we get later this year, the narrative changes to an inflationary narrative as opposed to a real growth narrative. >> that could spook some people certainly. jim, thanks so much. jim bianco. now back to brian on capitol hill. brian? >> thank you so much, michelle. a bunch of congressional leaders lined up with the president. mitch mcconnell was to the right. his office is about 100 feet that way. a lot of smiles as you walk around the building today. does last night's speech mean things are more likely to get

done? let's bring in ken guberstein, chief of staff under president ronald reagan. he had tip o'neill, partisan fighting but able to get something done. has anything changed from the president's speech last night to today in terms of the likelihood of legislation actually getting passed? >> i would think, yes. >> why? >> because he has reassured the american people that he's presidential, that he's into governing, not simply campaigning. he understands that the governing is the hard part. what the american people heard last night was a president trump who is willing to reach out, some on the democratic agenda and some on his base agenda. but by bringing people together by the optimism, reagan optimism, no, it's not morning in america but it's getting

there. because it's that can-do spirit that trump will, i think, resonate with the american people. >> you make an important point, ken. a lot of stuff we heard is on the democrats' agenda, right? maybe a little protection for the manufacturing workers, maybe a little trade issue, maybe a little spending on infrastructure. we saw democrats stand up and applaud. but there's been a -- on both sides, to be fair, there's been a culture of obstructionism holding things up in washington. will that change, even though the president did extend some legislative olive branches to the dems? >> the question is whether or not the democratic base, which is increasingly progressive, will allow their elected members, senators and congressmen, to have the flexibility to make some compromises. >> you're a guest. you know a lot of these folks. will they be? >> i would hope that they would be. right now it's obstruct and delay and they can't run on a

platform like that. they have to find some ways to win. and winning with president trump. so you pointed out infrastructure. that is a win for both sides. tax reform, i think, can be a win for both sides. >> even though the gop controls congress and the white house -- >> right. >> does the gop need to give up anything? do they need to negotiate or can they literally be the hammer to the democrats' nail? >> most thing in the senate you need 60 votes, not 50. >> need a couple votes? >> yeah, but on tax reform, it's 50. because it's through -- >> cr, continued budget resolution. >> reconciliation. but there are always times you're going to need opposition votes, democratic votes. will they provide them? i would think if the american people put the pressure on, the answer will be yes. >> i hope we get a ronald

reagan, tip o'neill moment. it is not morning in america. it is afternoon in d.c. pleasure to have you on, sir. >> thank you very much. >> tyler? brian, thank you. largest tech ipo in nearly three years. enormous valuation, limited shares and experimental business model, not everyone is snapping up the snap hype. should you? that is ahead. manufacturing under president trump, how does the industry, manufacturers that is, feel about business these days? we will take the pulse of one of america's oldest and most familiar manufacturers. the ceo will join us next, live. y cashback credit card, you get rewarded for buying stuff. like what? like a second bee helmet with protective netting. or like a balm? you know?

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welcome to "power lunch." 300 point pushing it above 21,000 for the first time. company outlining growth plans during their investor meeting today. mickey d's launching a mobile order app by the end of this year, up by 1.4%. >> shares of wisconsin based

briggs & stratton, up today. they make generators, snow blowers, power washers, lawn mowers and more. i have one of them, by the way. around 90% of their engines are made here in the united states. todd tesky joins us now from an event had his home state of wisconsi wisconsin, focusing on the future of manufacturing. you're an american company through and through, have 6,000 employees, all but a few hundred of them in the u.s. do you use, as you make those wonderful engines on my snapper, do you use parts that are sourced from overseas? >> tyler, we're a 109-year-old company. 85% of what we make is here in the u.s. we do have some components that come from overseas. the bulk of what we do is here in the u.s. >> border tax wouldn't really hurt you, affect you very much? you don't do a ton of it?

i assume you do a fair amount of exporting. so that actually helps you, right? >> we do. we do export. major markets are places like europe and australia. of course, border tax would help us here in the u.s. the thing we get a little concerned about, though, are there going to be trade blocks that will happen throughout the world? if there's some sort of retaliation, then what happens at that point in time? that could help us but there is still concern overseas. >> i assume your business, in part, is tied to housing and home improvement upkeep. obviously, you have a business of professionals who are involved in various things. but that a lot of it -- the products i know are ones that would be tied to the housing market. is that true? if so, how are you doing? >> we're doing well. in fact, tyler, our business is changing actually quite a bit. and, yes, you're right. historically, it has been about

housing. we've got exposure in oil and gas, infrastructure. a lot of things that have been talked about recently, inf infrastructure spending and that sort of thing are a great interest to us. when you look at high-end housing and multifamily it's done really well, which has helped our commercial cutting or equipment business. in the starter step-up homes have been lagging a bit. you're getting more and more millennials coming into the market with demand. the question is, is supply going to keep up? it hasn't to date. we're cautiously optimistic that there will be more and more homes out there for the step-up folks. a lot of exposure across a lot of different industries. so, we're cautiously optimistic about this year. >> tell me about your company before and after the election in terms of sales, your hiring,

your customers more optimistic? and are you more optimistic? are you taking actions because of it? i just spent two days at the rental show. overall, it seems people are more optimistic. of course, it takes some of the policies to make their way into the market at that point in time as well. cautiously optimistic of where we're at. consumer optimism and consumer confidence, i think we'll start to see -- we have been seeing a tick up. it will start to pay some dividends. cautiously optimistic. >> todd, thank you so much. todd teske, joining us a day after president trump's speech. dom chu with a market flash. what's going on? >> right now, the gold miner's etf, ticker gdx, positive in midday training. gold fields, new gold, basically

royal gold, every one of these stocks is up between 1% and 3% so far. dpoe gold is at session highs but lower on the day. still, melissa, another dynamic here to watch. the dollar. it has been falling a little off from its highs earlier today. that may be playing into the bid for gold and gold miners. back to you. >> dom chu, thank you. epi-pen maker mylan. is the worst behind for the stock? that story is next.

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welcome back. i'm melissa lee. this rally could still have room to run. march is historically the second best month for stocks, averaging returns of 1.5% the last 0 years. kensha is teaming up with s&p global. data sharing, next phase of machine learning and a.i. shares of the epi-pen maker mylan is up today. >> we are seeing mylan trade up today, beat in the quarter and what they project for 2017, revenue growth coming in ahead of estimates from analysts. there are questions about the

results, which presumably mylan is answering right now. their webcast started at 1:00. we'll get back on that and bring you any news. where does growth come from? the company said they're continuing to see erosion in pricing of generic drugs, something we've been hearing a lot of, with poor results from valeant and perrigo as well. also what's happening with the epi-pen. it looks like they are modeling some erosion in the epi-pen. exactly what that will look like, we hope to learn more details about today. that's the main thing for mylan as they've been dealing with all this pushback on pricing. we've seen their ceo come out and change the narrative about how people talk about drug pricing. >> you said at the top-end of the range that assumes 11% revenue growth. how do they get that if they're facing drug price erosion 2017? >> yeah. he did make that point. and also the company reiterated it plans to get that that $6

adjusted number in 2018. we've been hearing that over and over again. some of that is tied to that $6 target. the peak of the epi-pen conversation. they reiterated that today. for 2017 look at top-end of eps, 5.55, peak still heading for 6. >> peak was summer, right? >> around back to school season last year. >> they haven't recovered from that, right? it's still slightly below that. >> it is. they have climbed a lot recently but not quite back to the top. and i think because questions remain about that. >> mylan ceo heather bresch will be on "power lunch" friday 1:00 pm eastern time. don't miss that. to sue herera for a cnbc news update. 66 degrees. not enough to break a record but

it was enough for antarctica. home to icebergs and those little guys, penguins, set the new record march last year. you may want to avoid filing a claim after getting into a fender bender. nationwide study showed that drivers pay an average of 44% more for car insurance after making a claim of $2,000 or more. why drive through if you can get delivery? investors meeting, mcdonald's said it would test out new delivery methods but working with third parties. 75% of the population in its top five markets lives within three miles of a mcdonald's restaurant. and spring breakers, pack some patience when you're heading to the airport. tsa is predicting 62 million people will head to the airport this spring. that's the most in a decade. that is the cnbc news update this hour.

ty, back to you. >> thank you very much. >> sure. we'll take you through some market stats right now. lot of green on wall street. one notable stock deep in the red, and that is best buy. we'll come back and talk more about that. right now, melissa, bring us up-to-date here. this is the kind of day we haven't seen in a long time. >> best day for the year, certainly. mcdonald's, he they reopened for trading after the analyst meeting and giving new projections for 2017 and capital return plans when the dow took a leg higher here. we're up 1.5%. financials, no surprise one of the market leaders, especially as we are now anticipating, with the fed funds futures flipping over to 70% expectation of a fed hike in march. financials are trading very strongly in today's session. >> president trump's speech last night, he sounded more presidential than he has in a long time. a lot of relief, i think, that -- all the things president trump did not say, right? he did not say mexico is going

to pay for the wall. he did not call chuck schumer a clown. >> fake news. >> no fake news. he acted -- normal? >> yeah. >> and the market's relief. >> he got you nodding your head and going, that makes sense. that makes some sense. and then the emotional moments with the girl who was senior or sophomore at notre dame, who was confined to a wheelchair. and the widow of the navy s.e.a.l. who was killed. really emotional high points of the evening and of a speech that i think really explains exactly why the market is moving the way it is today. we mentioned a minute ago -- i got a little ahead of myself. the sea of green on wall street. but there are some red graphics. that would be best buy. we will tell you why, what's going on at bby, when "power lunch" returns.

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pr5%. larry kudlow appeared on squawk alley earlier today and said the border adjustment tax is alive and well. i am told late yesterday afternoon or this morning a meeting with white house representatives were told that the white house does, in fact, favor the border adjustment the the president went to the water's edge. didn't quite mention it. but, in fact, inside the white house, the b.a.t. is winning. >> courtney reagan covers retailer and joins us now. this will come as a surprise. >> one of the ceos that met with president trump a couple of weeks ago, and the other members of congress and best buy ceo told me as well as a handful of

others on a media call today when he's thinking about the border adjustment tax he said, quote, i think there are a growing number of people in washington that understand that the border adjustment tax is a ricky gamble with potentially devastating consequences for america. if i had to place a personal estimation it would be that the border adjustment tax is not going to happen. >> very interesting because, as larry said just now -- >> yes. >> a lot of people listen to that speech and think president trump was signaling maybe that he supported it. he says we must create a level playing field for american companies and workers. currently when we ship products out of america many other countries make us pay very high tariffs and tacks but when they ship into america we charge them almost nothing. why that is significant mimics, echoes from what we hear from kevin brady, speaker ryan, that

this is what's used to support the border adjustment tax. >> right. president trump is one that likes to negotiate. we all know that. he said i'm not giving away anything that was said in our private meeting. but if you institute a border adjustment tax that blankets this 20% on anything imported that takes away the ability to make deals individually with countries that may not be playing fair in the administration's eyes. >> in your interview with brian cornell yesterday, the first ceo who actually placed a number of the impact on target of a border adjustment tax and the numbers almost didn't make -- >> said 70%. >> effective tax rate is currently 38%. >> and it would rise to 70%. >> 75% is what he said when we went bakt and looked at it. he wouldn't exactly give us a number on the profits. i asked what does that mean for your profitability? he said not just target, but all

retailers would have to raise prices. i don't know if they really understand what that means. tax rates go up, we raise prices. what does that mean? if prices go across the board and consumers have no choice to pay more, will they? will some retailers try to take it on the chin and not raise prices as far? >> always an argument that the prices won't go up because the dollar adjust. >> retail ceos don't believe that argument and think it's a risky gamble. >> thank you, courtney. let's get back to brian on capitol hill. >> melissa, thank you very much. chris krueger, i always try to jump in on those comments by the best buy ceo make me so -- whatever. let's talk about a very simple question. did the feel-good moment of last night's speech, should it, equate to a 300-point gain on the dow today? >> no, right?

>> you say yes. what do you mean no? >> the market likes teleprompter trump way more than twitter trump. it's style over substance. nothing that trump said last night is new with the sepths of his one new policy development, which caused audible gasps from the democrats, agency of department of homeland security. he said it with a smile and didn't talk about fake news and some of this other stuff. style over substance. nothing really new. >> what do you think is behind this optimism? >> trump looked presidential. he played the role, played the part. it's teleprompter trump and not twitter trump. >> can you succeed -- we just found out a little bipartisanship will go a long way in the stock market. >> that or just talking about pro growth items. but he wasn't -- he was talking about, you know, if not border adjustment tariffs, he's talking about building a wall.

he's talking about, you know, new agencies at homeland security. this is not -- this was not morning again in america. >> i'm not going to ask you to comment on best buy. you toent cover the company, i know. ceo best buy is saying things like devastating consequences on american families. you sell flat panel tvs. they're $1,000 now. raising the price by 15%, devastating consequences like losing your heat or getting really sick. kind of odd comment by him. that aside, does it hate the border adjustment tax so much that if we get it, this rally will be -- which is a technical term. >> sure. couple -- two things that the market really fears. both with trade. one of them is border adjustments and the other is that reciprocal tax that no one is sure what they're talking about. it sounds like a blanket tariff.

and the end game if you don't buy the arguments, et cetera, is a trade war. >> i understand the concern. maybe the price of an x-box will go up 10%, never mind it's come down 50% over the past three years. that aside, does the retail sector, do they have any kind of point or is it more of just a scare tactic that they're going to ruin the consumer economy by lifting prices? as you point out, any border adjustment tax will be done in the framework of broader tax reform. theoretically, we'll get a currency move and make the stuff in america anyway. >> the biggest thing the b.a.t. has going for it, the trump card if you will, it raises $1.1 trillion over ten years. if you want to pay for tax reform, make it permanent, you need the b.a.t. or you need to find a fem om nphenomenally big of money. >> don't get too wonky on me. you're a smart guy.

tax reform, border adjustment tax, obamacare repeal. there's all these little things that are extremely important, april 28th we could see a federal government shutdown. do you feel like there is still sort of an anchor tied to the gop's legs by the democrats from a policy perspective where they might force a showdown over a shutdown of the federal government? >> there's no question there will be a showdown over the shutdown, right? trump is doubling down on building the wall, which is a red line for a number of democrats. he did mention planned parenthood last night. that will be another big issue. you have the defense budget numbers. you've got a lot of incredibly controversial stuff. april 28th, that first hard catalyst most importantly needs democratic votes to get that through. if democrats want to sit back and get ready for -- >> twidle your thumbs. we could have a shutdown. >> art of the deal. we'll see how it plays out. definitely will be a bumpy ride. >> i see what you did there. >> see that?

>> i saw what you did there. art of the deal. chris krueger, great stuff. i don't know if you got my point, michelle, on the best buy stuff. the price of electronics fall by 50% every year. i don't know that that will have a devastating consequence on the american family. that would be editorializing for me to say that and i won't say that. back to you. >> peter navarro was on and said prices go up a little bit. >> what if wages go up? what if jobs -- i don't know if they will or not but i don't think it should be devastating that the price of an x-box rises 10%. that's just me. >> i know. thanks, brian. largest tech ipo in nearly three years. the question is, should you buy it or steer clear? we'll take a closer look, next.

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take a look at this chart by aegis capital research. some investors are spooked by the drop off. that's the key thing to know about ipos. their prices are not always determined by models, estimates. much of it is based on momentum and snap seems to have enough of that to drive demand. sources tell me that snap will likely price a buck or two above the range, could yield a market value of $25 billion, which was the target they initially had been seeking before their ipo even launched. they could benefit from scarcity. very few tech ipos in the past few years and only selling 14% of the company.

in a filing this week, snap disclosed 50 million shares or 5% of t 25% of the offering would be sold to those who can't sell shares for a year. they believe it will pop on the first day of trading. >> still, 25% of the shares are committed to people who won't sell for a year? >> they're locked up for a year. by a few investors who have agreed to these conditions. actual float size of what they're offer something small. you consider supply and demand -- >> that makes it smaller. >> it's about 10% if you discount the shares already locked up and committed by investors. that could engineer a pop right the there. >> they said you had more and you did. leslie, thank you. should investors buy the hype and invest in snap? pacific square research and eric kaine of good water capital.

eric, i'm going to start off with you. you put out a pretty detailed note about snap and came up with $14 to $16 a share, published range right now and shares multiple of 15 to 17 times, similar to facebook and twitter at their ipo. what does that tell us about snap's? is it going to trade like a facebook at the ipo, that didn't do well or twitter, which did well at the ipo? >> right. i think they're trying to draw a comparison to facebook. facebook trades at about $400 billion market cap. even at a $25 billion number, which is a large number, it's still 1/16 the size of facebook. they're still targeting the same advertising dollars. huge market. $650 billion up for grabs. it's all about who will get outside market share of this enormous market still available to them, dominated by legacy, tv, radio and billboards and from a digital perspective will

take control of this enormous market opportunity ahead of them. >> greenberg, we've known each other a long time. i have a feeling that you're going to point at the fact that 25% -- actually, we're having difficulty with heshrb's shot. i apologize. if they got the chance to get an allocation would you say, yeah, go ahead and do it because of the scarcity value of snap, even though you're not going to get any voting rights, even though 25% of the load will be locked up for a year? >> we intentionally try to stay neutral from a buy or sell perspective. we weighed in on both cases. from a buy perspective, snap has done a great job of positioning themselves as a camera company. our belief is that they are trying to say we are the lens through which you experience both social and media content.

>> does that mean that you have to interpret what they're trying to get across a bad thing? they say we are a camera company. that to me says woore are a hardware company and it's going to be a race to the bottom there. the way you put it sounds a lot better. >> i think what they're trying to communicate is versus facebook, yes, at the time of ipo, facebook was growing faster and even twitter. but compared to the tv companies, which still make up 50% of the advertising market today, you know, we are -- our subscriber growth is growing much faster. those companies are still getting 19 times multiples. facebook is getting 23 because of its growth. you can't just compare us to one. we're a hybrid of both traditional tv, social media and digital media. >> what will it do the first day, pop or not? what do you think? >> our sources, what we've heard, is it's as much as five times over subscribed. >> you get an allocation, buy it

and flip it that day, at least, right? >> we'll see what happens. if you're a long-term believer, 16 times facebook, that lays out a good argument there. on the risk side, though, you look at the user growth, comparisons, average revenue per user. facebook was four times bigger than when snap went public. look at all these details to figure out where you should end up in terms of buy or sell. certainly the risk signals are there as well as the buy signals. facebook, yes. >> such a way not to take a stand, eric. unbelievable. if i had a tightrope i would put you on it because you could walk across the grand canyon. >> all about threading that needle. absolutely. >> oh, gosh. >> eric, thank you. >> thanks so much for having me. we went from dow 20,000 to dow 21,000, just 35 days thanks to these stocks. you'll have to wait two minutes to find out what these stocks are. we'll be right back.

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welcome back. it took only 35 today days for w to go from 20,000 to 21,000. dominic chu joins us now. >> 35 calendar days. the trading days, number of bars it took to get here was only 24 of them. relatively short amount of time. straight line higher relatively for the markets, the dow here since election time. let's put it in perspective. 1,000 points gained between 20,000 and 21,000. these are the stocks that got us here. perhaps no surprise. apple, the biggest point contributor of the thousand points came from them, goldman sachs, we've been telling you about this all the time for the last couple of months here, adding 111 points to the thousand-point run and boeing shares add 105 points.

overall, these three stocks total about 333 points, which means, yes, one-third of the entire gain in the dow between 20,000 and 21,000 has been those three stocks. apple, goldman and boeing, the most important three stocks to the dow. >> rising interest rates, dpoeldman i totally get and a lot of belief dodd/frank might go away. lot more trading power there. boeing, a lot more defense spending and then apple is just because apple always -- >> apple is apple. >> but the other thing that's always important to think about when you think about the dow, it's a price weighted index. more pricey, the more expensive the stock. and i forget where goldman trades right now. it's an expensive stock. small move in an expensive stock like goldman moves the do more than a small move in a cheap stock. >> thanks, dom. >> just remember that. >> the more you know.

>> dom, is that right? >> absolutely. >> you are absolutely right, tyler. absolutely right. boeing and goldman always near the top. back to you. >> thanks, dom. about to get the latest read on the u.s. economy. beige book is out at the top of the hour. will it keep this rally going? we'll find out next.

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welcome back to "power lunch." we are in record territory across the board pretty much. dow is up by 1.5% or 311 points. let's get to hampton pearson in d.c. >> expanded to a moderate by modest base. home construction and sales expand in most districts with low inventories in many areas. retail sales increased but at a subdued pace. several districts noting a shift from in-store to internet purchasing. businesses overall described as optimistic about the near term outlook but not as optimistic as in previous reports. labor markets remain tight, widening labor shortages in some districts, wages rising

moderately. engineers and i.t. workers driving up their wages. price little change, both input and selling prices to increase in the months ahead. interesting snapshots from around the country in new york, the housing market is weakened. at the high end, but commercial markets are picking up. cleveland, the expansion is described as continuing with both business and consumer confidence on the rise but only a slight increase in business investment, enrichment, ports in that area are experiencing record volumes. in minneapolis, however, concern is about retail sector layoffs and store closings. finally, dallas, sector seeing more demand and more hiring. increase in certainty surrounding the trump administration policies and for manufacturing exporters, concerns about the strong dollar and the softness in the mexican economy. next meeting of the fed is about three weeks away with the odds of a rate hike on the rise. back to you. >> they certainly are, hampton

pearson. let's bring in steve liesman. the market was already high. it's not going higher. it certainly hasn't moved lower. don't see anything in this that worries it. >> showing a continuing modest to moderate pace, which is code for around 2% growth. i'm interested in this notion f of -- it's of use for one reason. are we seeing it translate into actual economic activity? that notion that -- i have to go back and look. when hampton said manufacturing activity is accelerating, some manufacturing surveys do well. today at 10:00, ism do better than expected. so, there may be some translation of this better confidence into real economic activity not just really high emotions. >> that would be significant. >> it would be. >> it would be. i'm looking at some of the comments about the election. increase in shares attributed to an ongoing post-election boost

in consumer confidence. >> wow! >> also a comment from a furniture dealer said the same thing. this other one was from cleveland. it's all anectdotal and that's not evidence but that's where you start to put the pieces together. >> real business people in the center of the country. >> that's why it's a useful report. >> thanks, steve. record market rally today. the dow up more than 300 points still. right now 307 points, soaring over 21,000. is there anything that can derail this surge? there certainly must be. david nelson is chief strategist with bell point and nancy tengler is cio with heartland financial. this beige book report indicates moderate growth. economy seems to be doing all right in most places, manufacturing picking up, as steve pointed out. you are concerned, though, david, about europe. >> my job is to find something to worry about. i think i've found it. >> it's no fun if you don't.

>> look at europe, there's a rising pop will you say messaul. these countries want to pull out of the eu and maybe even the kurpsy. translate that to the bond market. widespread between french and german debt. if, in fact, a country pulled out of the eu, then the denominated debt would switch. that concerns me and hasn't translated to our shores but something to look at. >> a lot of the worries, true, that we've had over the past year, whether it was brexit, u.s. elections, so forth, people have worried a lot but the markets have kept going. >> a lot of people pulled out of the market just prior to the election. we even heard from clients that wanted to pull out before last night's speech. they were concerned what might come out of that. >> they would have been wrong. >> they would have been wrong. >> nancy, what did you pull out

of the speech last night that helps explain why the dow is up 300 points today? was it simply a question of tonality or was it, for example, his sort of doubling down on the idea that he wants to spend $1 trillion on infrastructure? >> yeah. i think that's an interesting point. he wants to spend $1 trillion but also privately fund some of it. people haven't really been talking about that. i think it's significant, original, interesting and potentially good for the markets and for stocks as we move forward. i like that. i also liked the corporate tax cut. and i -- i don't disagree with larry. he knows people and is smarter than i am. but i thought after last night's speech we were less likely to see a b.a.t. >> border adjustment tax. >> yes. >> that quote that you had, michelle, from the speech last night sounded, as larry mentioned, he walks right up to the water without mentioning it, but the parameters.

>> the intellectual construct. >> right. you still don't think it's going to happen? >> i don't know if it's off the table. i just -- i hope it is. i don't think it gets through the senate. and i do think that that is one of the ways he plays the game. sorry. >> i wanted to break in and say one thing. there's a lot of unintended consequences that could come from a border tax. not the least of which is that a lot of this depends on the u.s. dollar climbing higher. that's what economists are telling me. that's an organization -- nothing against steve, but it's an organization that hasn't really been able to pick up -- >> he's not really an economist. he just plays one on tv. >> very nicely. >> do you have any opinion on whether the dollar would adjust 20%, 25% if they do a border adjustment tax, like larry somers said he thought the dollar would adjust dramatically. not that he thinks it's a good idea to do it but -- >> most people i spoke to did not hear donald trump talk about a b.a.t.

they thought it was a moment for him to seize it. he did not. he fell short of it. >> i agree. >> there are all kinds of problems with it. let me point out one. you cannot have a b.a.t. that reduces the trade deficit and raises revenue. all the revenue from the b.a.t. is from the trade deficit. you can't have your cake and eat it too. that's one thing that even the guy who plays economist on tv will tell you. dollar adjusting that creates problems that nobody really wants to do. let's cut the corporate tax, see how that works. if we need to do additional steps -- >> and the repatriation tax holiday. >> he didn't mention either. >> i know. >> he also didn't say 15% on the corporate tax which is another reason why to say -- >> are we counting a lot on repatriation? my question is, what will the ceos actually do with the money? will it find its way into the

real economy or do we fund more buybacks? >> isn't it good for shareholders either way? >> it is. >> do you care if they buy back or if they -- >> i do care. >> for your bottom line -- >> my bottom line i want to see ceos put that money back into the economy, research and develop. >> i don't mean that. i mean the shareholder. >> it's not all about the shareholder. it's about you become stagnant. you become ibm. $18 million of stocks for the last 18 years. >> so you care about them reinvesting it? >> reinvest money. eventually you run out of steam. >> ibm is up. anyway -- david and nancy, thank you. steve, while we have you -- >> seize the moment a few minutes ago and should have told you one thing worth pointing out, people have downgraded their forecasts for the first quarter here. because of the personal income and spending numbers today and bad trade deficit numbers we're down 2%.

2.3% for the first quarter. that's a pretty good decline right there. q4 at 1.9. i want to show you who is where and what they did. atlanta fed coming down a massive .7%. bank of america, merrill lirchl 1.3%. i don't know if the market looks at this data says this is the q1 weakness. a seasonal problem we've had for a while and we're just going to ignore it or they see this great fruit at the end of the legislative process and they're just going to wait till that -- plow through the red light of weaker growth, higher interest rates and all of that will pay off the with the green light of fiscal policy. >> thanks, steve. >> thanks. bob pisani is at the new york stock exchange with the latest. >> it's not generating any uncertainty down here, melissa. let me show you specific parts

of trump's speech moving the market. more money for defense spending. etf for that. historic high for that, boeing, honeywell all at new highs. he he talked about a big cut in taxes, massive tax relief for the american middle class. that, of course, would help spur savings and investments. asset managers, blackrock, jaffray moving up. xpd has been moving up. deregulation task force in every agency. of course, banks would be the biggest beneficiary of that. that's also sitting at the highest levels since 2008 right now. then the president reiterated his desire for a $1 trillion infrastructure spending program. infrastructure stocks at new high, united rentals is a new example. hvac companies like lennox also up notably.

guys, back to you. >> thanks so much. now to the bond market from the stock market. rick santelli. rickster. >> as we go through the charts, but so many other things. look at intra-day, dollar index. a good place to start when the fed is involved. not much intra-day. if you look at the week it's been a big week. you ponder we're still down on the year on the dollar index. here is what's weird, up a bit on the euro versus the dollar. spra day of twos, where fed volatility should be. they're up on the day but not up or down much since the minute -- excuse me, since the beige book. look at intra-day ten, one week of ten. we've popped in new territory that is now down on price, up on yield by a whopping two basis points. here is the money chart. we always talk about percentages and fed funds and usually you need a microscope to see these moves. here is the year-to-date of the

april fed fund futures. i picked april. it's a clean month. you don't need any math there. see that fall off a cliff? that's what it looks like when the markets and fed get on the same page with regard to a tightening. back to you. >> rick santelli, thank you so much. stocks soaring. records highs across the board. dow up 300 points above 2,000. all the angles are covered on this rally. and the big names keep on coming. wisconsin governor scott walker will join us. what he wants in tax reform from president trump. plus, exxonmobil planning to boost spending. what it may mean for the stock. i love how usaa gives me the peace of mind and the security just like the marines did. at one point, i did change to a different company with car insurance, and i was not happy with the customer service. we have switched back over and we feel like we're back home now. the process through usaa is so effortless,

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welcome back to "power lunch." huge rally in the market. the dow is up more than 300 points. one of the stocks helping the dow cross the 21,000 mark today, exxonmobil. they announced they will increase capital spending in 2017 by 16%, eventually reaching $25 billion per year. what does it mean for exxon going forward? senior vp and energy analyst at raymond james is here. good to have you here. >> thank you. >> people were worried if they were enough to replace the oil.

people want them to do more exploration. are you satisfied with this decision? >> to put it in perspective, exxon was guiding to flat production through the end of the decade and now they're targeting 1%. it's very meager. we're in a bull market for oil, obviously a recovery from the lows of last year. in this context, people want growth. mid single digits. high single digits. exxon is still way at the bottom of the pack. >> you would like more -- >> exxon was a great trade when oil was falling. the stock was flight to safety,

you know, you had that conservatism. >> when you're worried about bankruptcies in the sector, you go to exxonmobil because they're not going bankrupt? >> that's right but that's too late, right? that was the trade in 2015 and early last year. over the last 12 months oil has doubled versus where it was a year ago. marathon oil, pioneer natural resources, large cap companies growing production by high single digits, even double digits. exxon's 1% is still very, very meager. >> you know, your research note says tillerson era ends with one thing he vowed would never happen. what was it? >> a write down of their assets. tillerson said very publicly we will never have an impairment. it's not our style. they just did in q4, took a $2

billion writedown. by the way they also wrote off 20% of their reserves. opposi optically, after they promised it would never happen to do it in such kind of a blatant way is not good. >> you know, pavel, in recent weeks i've been reading about the frac'ing guys, highlighting names like high crush, u.s. sillica. they've got pricing control. that tells me activity is picking up in shale places. is that the read-through here? >> yeah. the producers are ramping up capex. exxon, you mentioned, doing it a little bit. obviously other smaller companies in some cases doubling capex in 2017. that passes through to the service providers, whether

they're drillers, pressu. oil is still not 100 bucks or even 70, which is where we think it will be later this year. with oil in the mid 50s, the industry is off to the races. exxon is kind of jumping on that band wagon. really in a half hearted way. >> got it. pavel, thank you for joining us. >> thank you. >> the new ceo of exxonmobil darren woods will be on "squawk box" tomorrow for an exclusive interview. tune in tomorrow 6:00 am eastern time. >> exxon helping to fuel the dow to 21,000 for the first time today. mcdonald's also giving a boost. fast food giant out with big news. we'll break it all down on this record-setting day. we're drowning in information.

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welcome back to "power lunch." i'm brian sullivan in washington, d.c. we're pleased to be joined by scott walker, governor of wisconsin. governor, thank you for joining us on cnbc.

we appreciate it, sir. >> thank you. >> maybe no state is as interesting as yours regarding the election. you turned. you went for donald trump. you've got a lot of manufacturers in the state of wisconsin. so far, it's early. have you liked what you've heard? do you believe that we are going to get the change that we need to create the jobs that wisconsin demanded at the election? >> yeah, i think so. last year, we had more people employed in our state than ever before. year-over-year numbers for manufacturing are the top in the midwest, one of the best in the country and one of the most heavily dependent in manufacturing. for us it's important we look at the overreach, costly power plant, as i call it, the obama administration did to overreach their authority through the epa. those things being reigned in are completely important. i want tax reform. don't get me wrong. i want us to replace and reform health care going forward. one of the number issues i hear

from employers of any sort but particularly manufacturing is reign in the out-of-control regulatory process in washington. and this president is committed to it. >> many manufacturers in your state also manufacture not only in milwaukee, surrounding areas but in mexico and other places. i can see where they may have literally a foot on both sides of the border adjustment tax fence. i'm sure you've talked to a lot of business leaders. what do they want? what would they say could be the number one thing they could get from where we're sitting right now to create jobs? >> certainly one of our biggest exports when it comes to medical devices and instruments would like that. harley davidson, the president mentioned that, about how much it costs for them to ship into many countries versus importing motorcycles from other brands into the united states. i think the number one thing beyond just the regulations i

just mentioned is lower the corporate tax rate. make it competitive with the rest of the industrialized world and allow those american dollars to be repatriated. that allows not just the companies but more importantly those jobs to come back home where more of our fellow americans here in wisconsin and across the country can go back to work. >> what is something that troubles you or something you have not heard enough of, governor, that you would like to hear more of? >> not that it troubles me. i'm excited i heard from scott pruitt, new administrator from the epa and others along the way. i just want to keep hearing more about how they're going to reign in regulations. about three-quarters of all the regulations the federal government is involved in could get rid of or send back to the states and the people and we would be much better off. we're more he effect ieffective and responsible in the states. not just medicaid but transportation, infrastructure,

environmental protection, energy. the more you send it back to the people, the states, the better off we'll all be. >> so, you're not at the federal level. though, you did try. but there is so much skepticism. >> i did. >> about whether or not president trump can get his agenda through. the senate doesn't like this. there's an internal war going on with the republican party, et cetera. you do make legislation or sausage at the state level. what do you say to the skepticism that is out there? are you convinced that the agenda he has set out can be accomplished? >> absolutely. the kiwi learned here in wisconsin -- more people employed here than ever before. cumulative tax cuts will exceed $8 billion over eight years. schools are some of the best in the country. health care systems are some of the best. we are working and winning here in wisconsin. a key to that was a few years ago when there were hundreds of thousands of protesters here in our capitol, occupying the

capitol. the occupied movement started right up the way in madison on my street. we listened to people, were thoughtful, respectful. ultimately we did the things we said we were going to do. instead of running away, we ran forward and ran through the pushback that we received and our state and most importantly our citizens are better off because of it. the same thing is true with the president, house and the senate. they clearly ran on an agenda, laid out that agenda, voters responded accordingly. there's some pushback, like there was here in wisconsin. the key is to be respectful, thoughtful, but continue to keep moving america forward just like we have here and other lawmakers and governors have done across the country. >> tyler mathisen here, governor. thanks for being with us. you mentioned $8 billion in cumulative tax cuts. what have you had to cut in terms of services to the people of wisconsin to keep your budget in balance? >> the biggest change we made

back when we first came in after our first election was we changed collective bargaining. as a local official i could see the waste, fraud and abuse that happened not only state but local government. we changed the way we do bargaining with public employees in the state of wisconsin and put the power back in the hands of the hard-working taxpayers instead of the elite, handful of government leaders that in the past have dictated state and local government. since tha then that's saved us $5 billion by a number of independent reports. because of our reforms that we did years ago, combined with the reforms by the power of our people to create more jobs and prosperity, we have a reform dividend in this state and investing it to the highest amount. k through 12 schools and technical colleges to meet our workforce needs. >> i don't know if you know this. i am a wisconsin taxpayer, spend some of my summers back there. roll back regulation but keep the water clean, please. before we go, i personally know

people who voted democrat for 20, 30 years and went for trump. mostly union folks. do you believe that those voters who went to trump that have been voting democrat for multiple elections, that they are now in the gop's team full time or do you believe trump was a one off? have they moved permanently? do you think the democratic party has lost them? >> well, i think that we need to, as elected officials and as candidates for future office, we need to earn those votes every single time. i don't think any vote, particularly those votes, are in any way a given. if you look at the map in wisconsin, it's almost identical to my three elections. the state or portions of the state, counties and jurisdictions i won three times are almost identical to what president trump and vice president pence won this last go away. i think it shows that people are sick and tired of politicians, particularly in washington, that say one thing and do another.

they were looking for someone to shake things up. donald trump will have to deliver on his promises. >> governor scott walker, do us a favor. bring the jobs back, keep the waters clean as well. i think you can do boeing. apprecia -- can do both. thank you for joining us. snap-on's ceo nicholas pinchuk live from the conference in madison, wisconsin, coming up on "closing bell." mcdonald's meeting with analysts to outline the next leg of its growth maplan. the burger giant making surprising moves. >> pretty bullish, optimistic targets they've set out and investors seem to like it. the stock was halted, pending these announcements made investor day, which was moved up this year. the market got a sense we were expecting something today, some sort of announcement. the most significant for shareholders, cash return. above estimates returning 22 to

$24 billion back the next three years up to 2019. mcdonald's even admitting during this investor day that they have lost kurz over the last six years and they're not going to the fast casual healthy but the traditional fast food competitors. mcdonald's is doing something about it. a knock on the golden arches is that they are behind the times. they're not relevant anymore. they're behind when it comes to mobile, something that they're trying to correct. mobile order and pay will go live nationwide across the u.s. in the fourth quarter this year. and they are also testing out delivery. yes. focusing on the big markets of the u.s., asia, germany, for over 5 billion customers that live just five minutes away from a mcdonald's restaurant.

and moving here to the u.s. after living in asia for so long, i'm so surprised you don't have delivery here already. you have that in china, hong kong, korea. it's fascinating that they're just rolling this out nationwide. >> i'm skeptical because it's so not a part of their core capacity for so long in the united states. hopefully, they get lessons from asia. i would love it if they deliver. >> do they have their own delivery people, which they would have to then hire? >> third party. >> uber, amazon. >> i don't think french fries travel well. >> i agree. >> what? >> you have to get them when they're hot. >> even nuggets. >> chicken. >> the margins are so low once you -- i wish them luck. >> still it's a wonder how it's taken them so long to thinking that tech nothing technology is a worthwhile investment. >> a way to put them into the future they say. >> they acknowledge all that stuff about healthy, blah, blah,

blah. who they lost out to were other hard core fast food chains like the burger kings, et cetera. nobody was abandoning them for healthy, just more efficiency. >> wendy's claim to have fresh beef pattis. that's quality as well. they took some of their customers away. >> shake shack is after the bell today. >> susan li, thank you. exclusive interview with mcdonald's ceo steve easterbrook tomorrow at 9:00 am eastern time on cnbc. dow topping 21,000. s&p 500 crossing 2400 for the first time ever. nasdaq also hitting highs. key levels you need to watch. with the help of the lowest taxes in decades, a talented workforce,

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liberty mutual insurance. >> sue herera with your cnbc news update. it is snow-less in chicago.

the city's largest march snow storm dropped over 19" in 1930. warmer temperatures are causing severe weather across the mid west. the region has been battered with strong tornadoes and heavy rains, which caused massive flooding, like what you've been seeing here in laurelville, ohio. researchers at ucla analyzed date area from 35,000 women and found those who had poor diets as girls and young adults had a 41% increased risk of developing early onset breast cancer. the most recommended new cars for 2017. the chevy impala remains the top pick for new large car and the cruz took top honors for the best compact. michelle, back to you. >> thank you so much, sue.

>> sure. >> dominic chi has a market flash. >> macau gamble revenue hit a two-year high in february as new resorts boosted spending there. shares of wynn 7% higher, las vegas sands, mgm, melco crown all up on the day. bearishness is at least fading, it could be a sign. as you and i both know, those gaming revenues can be relative. >> dom chu, thank you. the dow soaring past 21,000 for the first time ever. s&p 500 moments ago, topping 2400 for the first time ever. nasdaq hitting record highs. trader's take on this incredible rally. joining us, cnbc peter costa. gentlemen, good to see you both. 2400. what are the levels you're watching at this point? >> at this point, the market has gone straight up.

peter thinks they've probably topped out here. this is all on the heels of donald trump's very presidential speech last night and the announcement of the $1 trillion infrastructure package. you put that on the back drop of the data we've seen recently in employment, cpi and everything is pointing green here right now. even the announcement or the expectation of a rate hike going up to 82% in march has done nothing to slow this down. we're sitting here, watching. >> peter, what are you seeing in terms of border flow? is this a rally being met with enthusiasm? >> yes, it's being met with enthusiasm from everybody in the united states and canada except for me. because i -- >> why are you the grinch? why are you the grinch, peter? why can't you get on the trump train? we've been rallying to record highs. >> oh, stop with this rally. every day. it's annoying. >> what about record highs? >> peter is giving up higher

prices for lent. >> just start now. no, the market has just runway ahead of itself. last night's speech was great. really, president trump looked presidential. i think the expectation was in such a negative vein. so the market reacted positively. the reality is tax cuts will take forever. you think that congress will sit there and give up all the sboimts they have for their districts? it's going to be a battle for months and months and months. infrastructure is the greatest thing since sliced bread. it will take ten years. >> buy the rumor, sell the news. we're still in the rumor face. >> you think so? >> i understand some of what peter is saying. but, look, you have to see what the tape is telling you. not just here. we're getting action in the options market. also, s&p calls are very active.

through the end of the year. not just what's happening here in new york, but the other markets, too. i'm not really sure what you think is going to slow it down. >> what i think is there's going to be, at some point, when you have the markets get so far ahead of itself, which i do think that they are, there could be a geopolitical situation that could cause a sell-off. >> you could say that any time in the markets. >> when you're this high, a geopolitical situation would be short term and wouldn't be that deep. when you get to a level like this, you have to be very, very careful. >> i hear your point, peter. what you're fundmentally saying is that there are details we don't know and that we can -- prices can go up while we are blissfully ignorant and hopeful about the outcomes. but when we start to learn more about the details, it could get a little choppier. right? >> yes. you said two words that are very

important. blissful. >> blissful and ignorant. that's my middle name. >> i try not to say ignorant on tv but blissful and hopeful. do we want snoopy and droopy, the rest of them to come in and start investing? we're at a point right now we just have too much. >> all right, all right. >> thank you, peter. >> thank you, grumpy. >> i am grumpy. i'm short in this market. >> gentlemen, thank you. >> do you know who is not grumpy? >> who? >> the financials are not grumpy. one of the best performers this year, goldman sachs up 10% in this past month. can this sector keep rolling? we debate it, next.

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we're watching pan dora shares higher by % as liberty media ceo is making some comments about the company. he calls pan dora and the application a great product that is under monetized and under executed. he also did say it's not an attractive business for us. pandora is undermonetized, a bunch of rell of itly

unencumbered competitors. it depends whether you're a glass half full or half empty. the comments come on the heels of the company's earnings call in which they did speak about pandora. pandora has been talked about possibly as a takeover target for sirius xm. >> thank you, dom. let's get to the next move with the trading nation team. research partner, nina sanchez. chris, i'll kick it off with you. what do you see for the xlf. >> out of favor for almost 20 years. today half the bank index making a new 52-week high, one of the best new -- >> 24 stocks in the index, half of them making new highs today. when the new high data expands, that is bullish longer term.

i think it's worth noting since election day there's been over 110 downgrades of bank stocks from the sell side. i don't thempg it's embracing this. we think there's a regime change. lastly, the last several weeks, it's important that the banks held up well even as the curve flattened. they seem a little more immune to curve dynamic, which is important. this is a group we want to stay long. >> what do you think about financials? >> i would agree. macro picture is incredibly supportive no matter what policies almost come out of washington. the reason for that is because we're looking at a situation where curves should naturally steepen. we have seen some flattening recently. curves are more likely to steepen. not only are you hearing talk -- in fact, we saw the probability of a rate hike go up dramatically after the speech last night, up to 8 %, which

suggests the fed will slightly take a faster pace at rate normalization but you are seeing tightness in the labor markets, melissa. u3 all the way out to u6, fully measured unemployment, way down. that will likely push up the ten-year up to 3.3 by 2018. that's good for bank stocks. >> chris, i have to ask you. i missed making my s&p 2400 cap. do i make a 2500 cap? what do the technicals look like for the s&p? >> the trend is up. that's what's most important here. if you're there, stay there. you can get a pause or pullback at any moment. you want to view that opportunistically. >> chris verrone, nina sanchez, thank you. march roaring in like a lion, dow soaring to 21,000 after president trump's speech to congress last night.

one thing noticeably absent from that speech, the normally super tough talk when it comes to china. what that means for the markets next on "power lunch."

president trump's speech last night fueling the markets to record highs today. one thing that was noticeably absent, normally he is really, really tough on china. last night he only mentioned the country once. joining us is the vice chair of asia-pacific for jpmorgan. you're normally in china. >> based in hong kong. i travel to china frequently. >> he mentions china last night and says, since they joined the wto, u.s. has lost 60,000 jobs.

negative, but he has sounded far worse when it comes to china. what's the reaction in beijing? they would have woken up and seen it in their morning? >> the rhetoric has actually been softening from trump which is positive for u.s./china relations. they've been trying to build trade ties and enhance the relationship rather than damaging the relationship, and i would say the chinese side has been exercising remarkable restraint in view of the strong campaign rhetoric early on. the foreign ministry has said, no one is a winner in a trade war. i would say last night's speech was reasonable positive for the u.s. market for sure but also for u.s./china relations. >> still, he's going to argue and his team has argued products go going to tariffs, there a

are -- and products coming in, there aren't tariffs. >> black lives mattchina runs a surplus with america, around $350 million. that trade number has gone from $2 billion in 1979 when diplomatic relations were established to half a trillion dollars. so much is at stake. going forward, i think trump will pressure the chinese to reduce any restrictions on u.s. exports into the country. on the other hand, he may try to, in some ways, penalize china's exports to america, right. that, we know, is going to be quite tricky because american consumers and american companies would be hurt if any tariffs were imposed on china's exports to the u.s. >> one of the things the president has said repeatedly is

that china is the grand master of currency manipulation. to your point, last week mr. mnuchin, the treasury secretary, was a little less emphatic about that point. that review comes up when? what do you expect will happen? and what will the chinese reaction be if indeed the administration concludes that china is manipulating its currency to its own advantage and our disadvantage? >> in the spring the treasury will be reviewing the countries including china for their currency policy. to date, no country has actually been named a currency manipulator. if you see the trajectory of the chinese renminbi, in november and december when the u.s. dollar was strong the china was weakening sense the dollar. since january and february, the

chinese yuan has been strengthening against the dollar. so it's hard to argue china is manipulating the currency to the advantage of china the country. i think, from the chinese standpoint, this is a critical political year because we have a chinese leadership transition. >> do you invest in chinese stocks. >> personally i don't. i try to avoid conflict of interests. >> what do you tell clients? >> i tell them, if you look at the u.s. market, asian markets and foreign markets clearly have lagged in performance, but maybe they'll play catchup. i would say the key issue here to watch is the u.s. dollar. if the u.s. dollar is reasonably stable, that will give china and other emerging markets a lot of room, some breathing room, basically. and i think asian markets, especially the hong kong market could do quite well in this environment. given the economy is on a more

sound footing compared to last year. >> glad to have you in the studio. a little more than an hour to go in this record trading day. look at all the green. that would be about 425 of the s&p 500, positive on the day. "check, please" is next. just like the marines did. at one point, i did change just like the marines did. to a different company with car insurance, and i was not happy with the customer service. we have switched back over and we feel like we're back home now. the process through usaa is so effortless, that you feel like you're a part of the family. i love that i n pass the membership to my children, and that they can be protected. we're the williams family, and we're usaa members for li. call usaa toda to talk about your insuranceeeds. whyour boss?ork for? yourself? your family? our financial advisors are free to realize a plan to fit your family's unique ne we'll listen. we'll talk. we'll plan. baird.

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the debt ceiling should be reinstituted on march 15th. by april 28th, if they can't agree, the government could shut down. great rally today. a lot of work to do despite the good feeling coming off last night. now everyone hates me. >> no! we're looking forward to having you back here tomorrow, ryan. >> i am off tomorrow. "closing bell" starts right now. hi, everybody. welcome to "the closing bell" on this crazy day here on wall street. i've kelly evans. >> i'm bill griffith. this is one to write about in your bullet journal tonight. >> that's a very on-trend reference. >> thank you so much. >> if we hadn't had the one down session for the dow a couple days ago we would be up 14 in a row. the fact that we're up this much after being up for s